The boat is believed to be carrying between 130 and 180 asylum seekers trying to make their way to Australia.

AMSA spokeswoman Jo Meehan says it has not been decided if those on board will be taken to Indonesia or Christmas Island.

"That's a decision for the Indonesian authorities who are coordinating the response to the search and rescue," she said.

During the past fortnight, there have been two asylum seeker boat tragedies in a similar area that have claimed the lives of dozens of people.

It has prompted Australia and Indonesia to pledge stronger cooperation aimed at stopping asylum seekers trying to make the dangerous boat journey.

Australia has also offered to help Indonesian authorities upgrade their communication systems so there can be better coordination between the two countries when there are safety-of-life-at-sea incidents.